Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
The mpc is defined as the fraction of a
The mpc is defined as the fraction of a. total income that a household either consumed or saves. b. additional income that a household either consumes or saves c. additional income that a household consumes rather than saves. d. total income that a household consumes rather than saves.
Expert Solution
As we know,
Marginal Propensity to Consume (MPC) = Change in Consumption / Change in Income
Marginal propensity to consume gives us the change in consumption due to change in income. It measure the extra consumption relative to additional income. Additional income increases consumption but the increase in consumption is less than the increase in income.
So, the correct option is C "additional income that a household consumes rather than saves".
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
